Donald Trump abruptly halted all trade negotiations with Canada Friday, blasting the country for its new digital services tax targeting American tech giants.
In a fiery post on Truth Social, Trump accused Canada of mimicking Europe’s policies.
“We have just been informed that Canada, a very difficult Country to TRADE with… has just announced that they are putting a Digital Services Tax on our American Technology Companies, which is a direct and blatant attack on our Country,” he wrote.
He continued, “Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately.” Trump warned that within a week, the U.S. would inform Canada of new tariffs they would face to maintain business ties.
Speaking later in the Oval Office, Trump said, “We have such power over Canada… They were foolish” for implementing the retroactive tax.
The Canadian measure, which starts collecting payments Monday and dates back to 2022, affects global and U.S. tech companies like Amazon, Google, and Meta. Despite pressure from Washington, Canadian officials said they will not delay it.
Treasury Secretary Scott Bessent said the retroactive move is “patently unfair,” and confirmed the U.S. Trade Representative may launch a Section 301 probe to assess potential harm to American firms.
With U.S.-Canada goods trade hitting $762 billion last year, Trump’s decision marks a significant disruption in one of the world’s biggest bilateral trade relationships. Canadian Prime Minister Mark Carney’s office has not responded.
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